It wasn't long ago that almost the entire street could confidently expect three rate cuts this year, starting in June, along with an economy gliding in for the softest of landings. Things don't look quite so simple as April gets underway. Fed speakers continue taking both sides and the markets interpret them as suited to their thinking.
Most likely macro scenario by the end of '24 looks like no Fed cuts & elevated rates on the long end & economy slipping into recession. Curiously, Monetary tightening of 2022/23 drove down inflation after a short lag- but when Fed halted since July 23, inflation stopped falling- is there a hidden message?
ADP is rarely market moving - however ‘job changer’ wage figure was eye popping and that's because are higher. Previously JOLTS was 'subtle'- the number of people voluntarily quitting their jobs — a good proxy for the level of confidence workers have in their job prospects — ticked up by 38,000 to 3.484 million and has been at the same 2.2% rate for four straight months.
The narrative of a booming service sector amid struggles for manufacturing is giving way - however Prices paid index dropped to a four-year low - employment index in contraction territory for the third time in four months.
The bid in the euro was particularly odd given softer German CPI and EZ inflation unexpectedly eased. Unlikely to close above 1.0824, 38.2% March/April fall.
Yellen's arrival in China coincides with tentative Chinese economic recovery - but structural struggle continues - reports that China had vacant homes that even1.4 billion population cannot fill them - vacant properties can house 3 billion. Sooner or later 7.3500 to break.
Downtrend stalled - however should stay contained between 1.2563 London low & 1.2675 38.2% Fibo.
Japanese inflation is a solution to all its three-decade woes - not a problem. They would be happy to see persistent inflation - of course a higher USDJPY - intervention threat is just for galleries. USD/JPY flirts with 34-year high and obvious intervention rhetoric gets stronger. The 13 dma, now at 151.26, tends to be more pivotal than the 10-day break above 152 puts up 155.20.
The Regulatory moves would bring the much-needed end to rampant speculation - a underappreciated fact is that these “speculation always had normally been impulsive with bets on downside in USDINR - USDINR stays well bid- on track to break above 83.77 -